Here is the scenario
You are head of a family of four.
Wife can’t work due to illness or injury handicap etc..
Kids, age 7 and 10
Income is impressive at 100k a year.
Taxes between state and Federal after all is said and done comes to 39%
You are left with a respectable 61k to live on.
The payment on your modest 5500 sq ft home is 3100 a month, or 37,200 a year
The payment on the BMW is 700 a month or 8400 a year, Wifes mini van is old but in good shape and paid for
Utilities for the home are 350.00 a month 4200 a year
Food costs you a modest 125 per week 6500 a year
Auto insurance 2500 a year
Credit card payment 100 a month, 1200 a year

1000 a year is left after payments to use for family outings, college funds, retirement, emergencies etc…
If this was your situation, how would you go about fixing this issue?
Again
Income 100,000 a year
Taxes 39.000
Mortgage 37200 a year
Car payment 8400 a year
Utilities 4200
Food/household supplies 6500
Insurance 2500
Credit card 1200
1000 left over after all is paid.
Find me a college fund or a vacation fund.

Downsize from that gargantuan house.

I would tax the rich and buy a new mini van.



Dang it - I hate channeling Dems - My ass will be sore for a week.:drummer:

Dave Ramsey would tell you the first thing to do is ditch the BMW and buy something that you can pay off almost immediately and doesn't have the high maint. bills - your insurance will take a dip too. That alone would probably help get you tuition/vacation money.
Cut back on "family outings". Since you don't offer how much these outings cost you. Take a look at utility bills and how your family uses utilities and cut back.
We found it useful to carry around a pocketsize notebook for a month and write down every cent we spent. We found a lot of wasteful spending habits that we both had and after a month we sat down and decided what we wanted to keep and what we could cut out. It was a good lesson in where our money really went.

Downsize from that gargantuan house.
Or rent out a chunk of it. Basement apartments can bring in about $800.00 per month $9600.00 per year.

Vehicles - if the wife is so injured she can't work - does she drive? Sell her vehicle and then cancel /lower insurance. Trade-in the BMW for a less expensive vehicle. I saw advertisments last night for a brand new honda - payments would be under $200 a month. Pay it off quicker. Again reduce your insurance.

Taxes - before your income is even hit, you can save into a 401k and various other savings plans. Reduces your taxable income level and gives you some savings.

Credit card - Take the money from selling wife's van, lowering car payments and pay off credit card. Don't use it again.

Utilites - look at what you are using and why. Start putting your energy hogs (phones, tvs, computers) on the energy savers. Unplug unneccessary appliances. Close off unused rooms. Look at other ways to cut a penny such as stop using the oven when the toaster oven will do.

Home - if you do not want to sell your home - look at refinancing at a lower rate. Also look at renting unused space - a boarder to bring in extra income. Or go ahead and downsize your home.

Miscellaneous home expenses - cut back on pizza nights. Use coupons. Cancel home phone if everybody has a cell phone. Cancel premium tv channels. Downgrade netflix account, and look at other ways to save.

Other ideas - start keeping track of exactly what you spend and where. Record every reciept. You may discover that you don't need to go to Starbucks every day for a latte. Use gamestop to trade in used games and use trade in credit to purchase other used games instead of buying the kids new ones. Have a yard sale. Downsize and get rid of every item you don't need by selling it. Also sit down and figure out what is actually needed versus wanted. If it isn't on the needed list - don't buy it. Shop for clothing and household goods at thrift stores.

I would start with the BMW. Is that necessary? Probably not. Insurance is high, and the payments are way too high. Do you need the "status" of having it?

Then get rid of the credit card and leave it alone.

Then start working on the small stuff. Find things you don't really need anymore, and sell them.

Income 100,000 a year
Taxes 39.000
Mortgage 37200 a year
Car payment 8400 a year
Utilities 4200
Food/household supplies 6500
Insurance 2500
Credit card 1200
1000 left over after all is paid.
Find me a college fund or a vacation fund.

BCP, I am not sure if this is an actual budget, or if you want SOMD Land to understand the current budget woes facing our country. I think it is all about cutting your spending.

Income - not too much can be done here (assuming a second job is not in the cards for you)
Taxes - not too much you can do here. No mention of a retirement fund which could decrease end of year taxes, but not monthly tax bill.
Mortgage - a 5500sqft house for 4 people is kind of excessive. However, in this climate, selling may not be a feasible course of action.
Car payment - I agree with a previous poster. Downsize the Beamer (van is paid off). My wife and I pay 6k a year combined for 2 2011 Hyundai Sonatas - one even has all the bells and whistles (Nav package, etc).
Utilities - Try going on a budget plan with the electric company. I am assuming your 350 per month is during the summer with AC (unless you have electric heat). Budget might get you down to 200-250 per month.
Food - Not too much you can do here.
insurance - Do you have the same company for home and car? Are you carrying full coverage on the paid off van? These are just some of the ways to reduce insurance payments.
Credit card - as long as you are not paying the min on the cards - not too much you can do here except to stop using them for impulse items.

Something doesn't jive....

39% in taxes is way to high! You have kids & a mortgage (write off's).
Utilities seems low for a 5500 sq. ft. house.
Eff that Beamer payment! Get a Camry!

You have an RV and take cross country vacations!!


What U hiding Willis?? :eyebrow:

Something doesn't jive....

39% in taxes is way to high! You have kids & a mortgage (write off's).
Utilities seems low for a 5500 sq. ft. house.
Eff that Beamer payment! Get a Camry!

You have an RV and take cross country vacations!!


What U hiding Willis?? :eyebrow:

39% combined.
I like candles
F that Toyota.

Sell BMW car and drive wife's minivan if she can't drive anymore.
Rent a basement or a room to help bring in extra income.
Cut the credit cards up, but keep one for emergency.
Have a yard sale to sell stuff you do not need or want anymore.
Get rid of "movies" packages on your cable or dish provider and stick with basic only.
Want to rent a movie? Go to library to check them out for free.
Want to read a book? Go to library to check out a book to read.
To cut electricity bill back, keep the lights off unless you are using the room and open curtains to use "natural" sunlight as a light in the house.
Get rid of trash pick up service and take trash to the dump for free.
Clip coupons to save money from paying full price on food, TP, paper towels, shampoos, etc.
Need new clothes? Check out freecycle, thrift shops, and clearance racks at the stores.
Drive to places only when you need to. For example, make a weekly list of what you need, so you only have to drive out to the town once a week for things.
Need outings? Look in newspapers/online for free events or special deals.
When washing clothes, make sure it is one load full to save water and electricity.
When washing dishes, make sure the dishwasher is full of dishes and turn it on. Otherwise with small loads or washing by hand waste more water and electricity.
Turn your A/C up to around 76/78 degrees.
In winter, keep the heat down around 68 to 72 degrees and wear more warmer clothes.

Buy a Quickbook software, and enter all bills and incomes to help you figure out where the money is going and where to cut back.

Just because you make 100,000 a year doesn't mean you HAVE to have a BMW or a 5500sqft house. I'd start there for the biggest savings. I make 20,000 (I rounded up for the sake of example) Husband makes 30,000. We live very comfortable with 5 kids, and have a savings account for a vacation also we save our change until the jug is full. It can be done, you just have to be willing to do it. Get your wife to clip coupons, if it isn't in sale or you don't have a coupon then don't buy it. Make a list of NEEDS and then another of WANTS. Needs are toilet paper, and food. Wants are swifter dusters and DVD's. Took my hubby awhile to figure out the differences. You can do it, just have to pick your priorities.

Borrow every penny you can on the house and every penny you can on your still-good name. Max out your credit cards buying easy-to-liquidate assets. Hold the money as cash or untrace-able cash equivalents. Mail the keys to your house and your car to whoever holds the mortgage and the lien. Declare bankruptcy. Claim you spent all the money on food and vacations.

Rent a $1,200 or $1,400 house. Buy a $5,000 semi-reliable vehicle. With a small portion of your cash-windfall, throw a party and invite everyone from Somd Online. Live happily ever after and send your children to Carnegie-Mellon or the University of Miami, whichever they prefer.


(For the record, this advise is not meant to be taken seriously. Oh, and it wouldn't work anyway.)

Borrow every penny you can on the house and every penny you can on your still-good name. Max out your credit cards buying easy-to-liquidate assets. Hold the money as cash or untrace-able cash equivalents. Mail the keys to your house and your car to whoever holds the mortgage and the lien. Declare bankruptcy. Claim you spent all the money on food and vacations.

Rent a $1,200 or $1,400 house. Buy a $5,000 semi-reliable vehicle. With a small portion of your cash-windfall, throw a party and invite everyone from Somd Online. Live happily ever after and send your children to Carnegie-Mellon or the University of Miami, whichever they prefer.


(For the record, this advise is not meant to be taken seriously. Oh, and it wouldn't work anyway.)

actually unless the laws changed, it could work.
Florida (as I found out too late after my first wife the beatch made off with my beach home,, not that Im bitter) where was I,, oh yes.
in Florida at least in the mid 80s you could borrow against your home and the loan was actually against the physical property and not the borrower.
This means, I could have taken a few hundred K loan on the house, never made a payment and they would have come up and tossed the ex into the surf and resold the house.

If I would have known, I would have done.

39% combined.
I like candles
F that Toyota.

39% combined still seems high, even for a household income of $100K. The annual mortage is $37,200. The mortgage interest paid each year should drop your taxable income to at least around $70K, maybe $80K.